China's rapid economic change can drive social and political change. For example the system of hukou or residency permits have for a long time restricted rural residents from claiming benefits when they move to cities. But the massive and ongoing migration from poor farms to richer cities has put pressure on this anarchonism. These migrants have made a mockery of the idea of residency permits, with conservative estimates of 87 million people living in areas with permits. And now the growing shortage of cheap migrant labour has forced cities and provinces to concede the system is broken.

Up to 11 provinces are contemplating abolishing hukou. This would allow rural migrants access to the same health, education and social security benefits as city dwellers. It will also end distinctions based on where you are from rather than where you live. The move is also considered part of the effort to close potential unrest over China's income gap between the rural poor and richer cities. Given the new 5 year plan's obsession with stability, more of these measures recognising economic reality are likely going forward. Another example was the recent doubling of the income tax threshhold.

But a key question remains. Are the cities ready for this change? Suddenly recognising the rights of 87 million (and likely more) people will put incredible strain on city resources. The China Daily report notes a previous effort to abolish hukou in failed:

In November 2001, Zhengzhou, capital of Central China's Henan Province, offered free permanent registration permits to people with relatives already living in the city. Increased pressure on transport, education, healthcare and a rise in crime forced the city to cancel the measure three years later.

The same report has a comment from the Beijing Public Security Bureau which notes that most large cities are similarly unprepared for a rapid transfer. Such a change will only happen gradually. Joseph Kahn's IHT story notes this change has been coming since 2002:

The central government first declared that it intended to do away with the hukou system at the 16th Communist Party Congress in 2002, and has been making incremental changes since then. The overhaul got a major boost in 2003 after a college-educated migrant in Guangdong Province, named Sun Zhigang, was beaten to death in police custody after being detained for vagrancy. His death brought nationwide outrage and led to the abolition of vagrancy laws.

"We knew it was a dead duck after they abolished the custody and repatriation system," or vagrancy law, said Nicolas Becquelin, a researcher for Human Rights in China based in Hong Kong. "The police had no power to enforce the hukou laws."

The key point is this: facts on the ground can push governments into changes they may not want to make. Even if they don't realise it, changes like this bolster those of us who believe China's economic changes will eventually force the collapse of the CCP and lead to democracy. Either way, this is a significant turning point in realising the old system is broken and a new one is growing before our eyes.

Great post, Simon. I totally agree that the authorities are doing it as a a way to relieve pressure on local, rural government ill-equipped to handle the rapid pace of change in China. For too long China has ignored the rights of the thousands of migrants who have made the imperium en imperio of China's major cities run properly by doing jobs the city-dwellers would not perform - effectively, the illegal Mexicans of China. This legitimizes their residency and makes official what is already fact - that million of Chinese have left the countryside for the opportunities in urban areas.

I mention the Mexican parallel because in a sense it poses as many issues as a similar legitimization would cause in America. China's social safety net, as hole-ridden and as dreadful as it is, will have to be extended to these migrants. They will have the opportunity (unlikely though it may be for most of them) to officially climb the socioeconomic ladder without having to pay bribes, and yes, as you say, they will have a voice that may make them a political force.

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